About the Project
This project entitled ‘Development Dimensions of the National Foreign Trade Policy’ is currently being undertaken by CUTS with support from the DFID Knowledge Partnership Programme to direct attention to instruments, institutions and schemes in the National Foreign Trade Policy which could be rendered increasingly inclusive with a view to aid developmental objectives, apart from addressing the growing trade deficit.
The UNCTAD studied the connection between trade and poverty and recognised that the benefits of trade were not always easily transmitted to all countries, or to income classes within countries, owing to a number of factors like limited productive capacity, less-than-optimal generation of employment and the institutional structures which exist. While some countries have successfully captured the linkage between trade and human development, many other countries despite attempting to diversify their sources of exports encountered a trap where either their agricultural sectors or natural-resources sectors constituted a substantial portion of their exports. It has been identified that one single policy cannot be used to address the linkage between trade and poverty. The report recommends that a specific tailored approach has to be developed depending on social structures, resource endowment and extant institutional frameworks.
The five specific areas which will be focussed in this project are as follows:
- Inclusiveness with respect to SMEs as major beneficiaries
- Coordination with external trade negotiations
- Linkages between NFTP and FDI Policy
- Role of NFTP in exploring and strengthening participation of Indian business units in regional/global value chains
- Role of NFTP in domestic policy and regulatory reforms for better economic governance
The project is being implemented at a critical point of time when the next National Foreign Trade Policy is imminent. The next NFTP should not only include a gamut of policy instruments which are capable of being adjusted to macroeconomic shocks and ripple-effects from the outside economies, but also instruments which operate seamlessly with other domestic macroeconomic policies.
The duration of the project is initially 5 months from November 2013 to March 2014, following which the second phase of the project may be reinstituted
Goals and Objectives
The literature review and the analysis of the Gaps in the National Foreign Trade Policy are intended to provide an input to trade-policy makers prior to the development of the next five year Foreign Trade Policy 2014-2019.
To obtain further depth in domestic trade policy formulation and its interaction with international trade policy to inform policy-evolution in developing countries in Asia and Africa, specifically in the following areas:
- In the study of national foreign trade policies and their interaction with other macroeconomic policies
- Reconciling institutional capacities in developing countries
- Achieving the objective of addressing regional inequalities and uplifting vulnerable social classes and disadvantaged industries
Activities
- Review of the National Foreign Trade Policy: this critical review of the schemes will be undertaken with an objective to study the lacunae in the provisions/institutions/implementing procedure which impedes the achievement of the aforementioned five objectives. This activity will involve a Scheme-wise analysis of gaps in the policy with respect to the following areas
- Inclusiveness with respect to SMEs as major beneficiaries
- Coordination with external trade negotiations
- Linkages between NFTP and FDI Policy
- Role of NFTP in exploring and strengthening participation of Indian business units in regional/global value chains
- Role of NFTP in domestic policy and regulatory reforms for better economic governance
- Based on the literature review on the GAPs in the National Foreign Trade Policy (instruments and implementation), the solutions which will be evolved may in certain cases include cluster development strategies for specific sectors with a view to enhance export promotion activities.
- In order to address the opportunities for integration into the global value chains a value-chain analysis for one product will be undertaken with an understanding of the supply-chain in South Asia.
- Case study of one East African and South Asian country
- The interviews with key informants will be based on the draft report on the Gaps in the National Foreign Trade.
- To obtain statistical inputs wherever possible
- To understand the feasibility of the solutions which have been posited, and to further refine the solutions and the analysis keeping in mind the comments made by the practitioners
- Specifically, the interviews with key informants will seek to unravel how the debates behind the inclusion/exclusion of specific trade policy instruments influenced the decision-making of policy-makers over time (as reflected in the various Annual Supplements)
- Government officials involved in the development and implementation of trade policy
- Bodies engaged in providing Trade Finance and infrastructure for trade
- Export Promotion Councils
- Industry Associations
- Cluster Development Executives
- The Literature Review will be refined with the inputs taken from Semi-structured interviews with Key-Informants
Literature Review
Preparation of draft-report on Gaps in the National Foreign Trade Policy:
Semi-structured interviews with Key-Informants
The objective of the interviews will be as follows:
The key informants include
Report on Gaps in the National Foreign Trade Policy
Outputs
Events
- Roundtable on India’s Foreign Trade Policy
- Brainstorming Meeting
Development Dimensions of India’s Foreign Trade Policy
November 29, 2014, New Delhi, India
January 31, 2014, New Delhi, India
In Media
- India’s new FTP to Focus on Transparency, Trade Facilitation: DGFT
- New Foreign Trade Policy will focus on trade facilitation, simplifying procedures and diversification of markets & products: Pravir Kumar, DGFT
- New FTP will focus on trade facilitation: DGFT
- New foreign trade policy will come when time is right: DGFT
The Dollar Business, December 01, 2014
Business Standard, December 01, 2014
The Statesman, November 30, 2014
Business Standard, November 29, 2014
CUTS Centre for International Trade, Economics & Environment (CUTS CITEE)
D–217, Bhaskar Marg, Bani Park
Jaipur 302 016, India
Ph: +91.141.2282821
Fax: +91.141.2282485
Email: citee@cuts.org
Web: http://www.cuts-citee.org/